Alternatives to Vanguard Advantage Accounts (Cash Management Accounts Being terminated)

Alternatives to Vanguard Advantage Accounts (Cash Management Accounts Being terminated)
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#1

Vanguard Advantage is their enhanced brokerage account (Cash Management Account) that allows easy transfers to and from Vanguard mutual funds, bill pay, direct deposits, check writing, ACH transfers (push/pulls to/from other institutions), etc. from their Federal Money Market fund which currently has an interest rate around 2.2%

I have been using the above features for many years, including having my credit card bills automatically withdraw (pull) balance payments from it, but Vanguard is ending Advantage in July.

Aside from the pain of going setting up my bills to be paid from some other account, most likely a checking account, I will miss the high interest rate. Is there a comparable product with a decent interest rate?


#2

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#3

This is a big topic of discussion at the Bogleheads forum (where I don’t participate) and at a different finance forum (where I do participate). You can slog through the 9 or so pages at Bogleheads, or you can investigate other products at these links:

https://www.fidelity.com/cash-management/fidelity-cash-management-account/overview

https://www.schwab.com/public/schwab/banking_lending/checking_account

I’ve been with both Fidelity and Schwab for several years, for both brokerage and checking/CMA. Fidelity does allow the purchase of securities in their CMA as well as their regular brokerage. I’ve read on forums that some Fidelity customers purchase a MMF in their CMA, because Fidelity will draw on it for payments and withdrawals if the FDIC core cash component is zero. I don’t do this. I just use it as a checking account. But it probably comes closest to what you’re looking to accomplish. Schwab checking is just that, a bank account that comes with their Schwab brokerage account.

I think almost any brokerage that readily comes to mind offers a checking/CMA of some kind. TDAmeritrade, MerrillEdge, Chase YouInvest (which is a fairly new product), Ally Bank w/Ally Invest, etc. I don’t know if any of them allow the funds to be kept in a higher-yielding MMF that can be swept from to cover checks, etc.